Before you start throwing out accusations of violating site rules about using Republican talking points, hear me out. I am providing this link to an opinion piece from the Murdoch owned Wall Street Journal on the public option as a preview of incomming fire from Republicans for 2020. I am an advocate for Medicare for All (Sanders or Warren’s plans), and I have criticized those who embrace the public option as the moderate alternative that should be relatively easy to pass into law. My argument has been that the public option will be villified as badly by Republicans and the health insurance industry as if it was Medicare for All. And we have some of the tryouts of the bogus arguments that will be used against the public option. If one of the moderate candidates wins the nomination, I hope who ever it is will be prepared for the deluge of lies.
First up, and you can guess what the main thrust will be, the opinion piece writers scream that the public option will be too expensive and bust the federal budget.
With Hoover Institution research fellows Tom Church and Daniel L. Heil and support from the Partnership for America’s Health Care Future, I estimated the fiscal and tax implications of creating a federally administered public option. If Congress’s past behavior is a guide, a public option available to all individuals and employers would add more than $700 billion to the 10-year federal deficit. The annual deficit increase would hit $100 billion within a few years. Some 123 million people—roughly 1 in 3 Americans—would be enrolled in the public option by 2025, broadly displacing existing insurance. These estimates don’t include the costs of additional Affordable Care Act subsidies and eligibility expansions proposed by Messrs. Biden, Buttigieg and Bloomberg.
The fiscal effects are even more pronounced over the long run. We estimate that federal spending on the public option would exceed total military spending by 2042 and match combined spending on Medicaid, the Children’s Health Insurance Program and ACA subsidies by 2049. In the latter year the public option would become the third most expensive government program, behind only Medicare and Social Security. The public option alone would raise the federal debt by 30% of gross domestic product over the next 30 years.
While some, like Mr. Biden, claim their health reforms can be paid for by simply taxing the wealthy more, that seems unrealistic. We conclude that if tax increases to pay for a politically realistic public option were limited to high-income filers, the top marginal rate would have to rise from the current 37% to 73% in 2049—a level not seen since the 1960s. Such large rate increases would undoubtedly have economic effects, causing revenue to fall short of our static estimates.
Emboldened is mine.
Hey! Doesn’t that last sentence sound a lot like the arguments that supply side idiots like Laffer make? If we raise taxes on the wealthy to those astronimical levels, wealthy people will not produce as much revenue because it will be all taxed away. Therefore, government revenues would fall.
So we get all the scare tactics of how the public option will bust the federal budget, but no damn talk about those endless wars and Trump tax cuts. Costs ONLY are counted as serious if a Democrat proposes a new government program. So the deficit peacocks are at it again. And you will NEVER be able to pay for a new government run program by just taxing the wealthy!
But if you Democrats insist on spending, spending, and more spending, you have to raise taxes on the middle class! Ah HAH!
If policy makers want to avoid a large increase in deficits, then, a public option would require tax hikes on most Americans, including middle-income families. An across-the-board income-tax hike to support this policy would mean that taxpayers in the 28% and 33% tax brackets would see their marginal tax rates increase by about six percentage points by 2049, while the top tax bracket would rise above 47%.
Alternatively, Congress could enact a new broad-based tax similar to Medicare’s 2.9% Hospital Insurance payroll tax. The new tax would be levied on all wage and salary income and would reach 4.8% in 2049.
Tax and spend Democrats go after the middle class! Where have I heard this argument before?
The only thing I agree with the opinion writers is this:
Beyond fiscal considerations, the public option would quickly displace employer-based and other private insurance. This would force some private insurers to exit the market and encourage greater consolidation among remaining insurers.
The author claims this will lead to higher premiums from the surviving private insurers. But they don’t go into the point that the public option would be competiting with private insurers. That is the whole damn point. And if some private insurers can’t compete with the public option and leave the market, it is the point of the public option. The original idea behind the public option is that Americans would eventually pick the public option over private insurance because the public option would be cheaper with the same coverage of the private insurance companies. In fact, this is the fear of the private insurance companies.
Anyway, those are the Republican talking points. The public option will bust our poor federal budget. To pay for this budget buster, you cannot get it all from wealthy people. You will need to gouge the middle class. And once you do that, Americans pay more for less medical care (the final part of their BS arguments).
My point is that the public option will not be spared the lies and scare tactics from Republicans who just want us all to die if we cannot afford healthcare. Those pushing the public option better be prepared for the deluge of Republican lies. And they are lies. The public option would be better than the present system, but it will not be as politically invicible to Republican lies as proponents profess.